Combining Finances and Efforts

Combining Finances

This is Rule 1 in my 10 Rules to Eliminate Debt and Change Your Life

If you are soon to be married and looking for a way to tackle the debts you have, or those that will be brought into the marriage, the first step once married is combining your finances.

If you’ve been reading Married (with Debt) for a while, you probably know how I feel about rules. They are generally meant to be broken or rewritten.

But, if you truly believe in something, there are generally rules to follow.

In my financial life, there are 10 main rules I follow (combining finances is the first one).

If you are looking for a path to debt freedom and financial independence that isn’t a rigid, no fun approach, then I invite you to join me.

Combining Finances

So what do I mean by combining finances? On a broad level, it means you have to ditch the mindset that “my” paycheck is my paycheck, and I use it to pay “my” bills and buy the things I want.

Your paycheck and my paycheck become “our” paychecks, just as your bills become my bills.

Why Combine Finances?

Combining finances requires a heightened level of communication between spouses, which will in turn lead to better long-term financial results. That means you aren’t bouncing checks and causing overdrafts. It could also mean you are setting a dollar amount for a purchase that you won’t exceed without first talking to the other spouse.

In addition to changing your behaviors, you have to change your mindset.

It can be easy to rationalize separate finances as a noble effort to preserve independence. This can be especially tough for women, who for generations have traditionally played little to no role in the family finances. Once they became fixtures in the working world, women understandably became proud and protective of their paychecks.

It can also be tough for men, who may harbor paternalistic notions of being the king with his treasure. Combining finances forces two to work as one.

In a perfect household with no debt and ample financial resources, I would say those couples experiencing success and financial freedom should keep things the way they are. There’s no need for combining finances if what you are doing is working.

But if you aren’t proud of your debt and want a change, or you are ready to get serious about some long-term goals, it’s time to take pride in a new ideal: equality. After all, isn’t that what men and women really want and deserve?

How to Combine Finances

The first step is to lay everything on the table, like I mentioned in the recent article, Questions to Ask Before Marriage. Your partner needs to know your income from all sources, your debts and liabilities, and your assets. Likewise, you need to know theirs.

Then you must start combining your separate accounts into one. Add your spouse as a registered user on all accounts. This also means combining your checking accounts into one and not keeping secret stashes of cash. This is a vote of confidence in your desire to truly combine your efforts.

If you aren’t willing to take these steps, you aren’t willing to be in an honest relationship.

No One Said This is Going to Be Easy…

Personal finance is not easy, that’s why it is going to take two people to sort out a mess that both created. Might as well start now with a major behavioral change, as that is the only way you are going to get out of debt (barring some planned or unplanned windfall).

If you are going to succeed with this, you have to be able to let go of past financial mistakes and forge a future of cooperation, togetherness and success. If you are resisting combining finances and know that you should, I urge you to sit down at the kitchen table tonight and develop a new plan that involves shared sacrifice, and shared prosperity.

If done right, combining finances doesn’t have to be restrictive. There is nothing saying you can’t each have some weekly spending money to do with as you please. In fact, I encourage this. But when it comes to the big picture plan and getting out of debt, most of your money needs to be put in the same pot.

In our marriage, we resisted combining bank accounts and bills for a few years, and those were wasted years with no progress, only slipping further into debt. Once we got on the same page, we were able to pay off almost $100,000 in consumer debt, car loans and student loans.

In these tough times, young people can’t afford to spin their wheels. If you are looking for a way to get some immediate traction, do your marriage and money a favor and start combining finances today.


10 Rules to Eliminate Your Debt and Change Your Life

1. Combine Incomes, Finances and Efforts 

2. Spend Less than You Earn

3. Make a Monthly Debt Budget and Live by It 

4Pay Off Debts Smallest to Largest, Regardless of Interest Rates

5. Make Big Changes for Big Results 

6. If You Don’t Need It, Sell It 

7. Save Monthly for Large, Anticipated Expenses

8. Set Aside Some Money for Fun

9. Pay Off Debts Before Investing 

10. The Goal of Work is Retirement 

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36 thoughts on “Combining Finances and Efforts

  1. I attribute combined finances and financial communication as probably the number one reason my wife and I have a great marriage. Money fights are the number one cause of divorce. If communication on this issue is open, chances of money fights are lessened which means longevity of marriage is greater.
    Matt recently posted..Spending Money for Sex on Valentine’s DayMy Profile

  2. I think you’re spot on with your #1 reason of communication. I know a lot of folks who don’t combine and while it does provide a bit of independence, I think you lose a bit in not discussing finances more often. In the end, poor communication (and limited communication) is always a bad thing.

    I also think that combining finances helps build up the idea of “team” for a husband and wife, which was my number one reason for combining our finances.
    Jim recently posted..Soft Credit Check vs. Hard Credit CheckMy Profile

  3. I agree that it’s smart to partially combine finances, but I think it is super important to protect yourself – ie, keep your own savings accounts as well.

    I’m going to sound like a cynic, and trust me, I’m not. I love marriage – I hope that when I get married, it’s a forever thing! But we’d be niave to think that divorce doesnt happen. Stuff happens! If you don’t protect yourself, you never know.

    I had a friend who combined finances completely with her husband and he “invested” all of their assets, poorly, causing the to lose everything. She didn’t know he was doing this, which was dishonesty, and it didn’t work out well for their relationship – they didn’t divorce, but if they did, she would have been screwed. So I say combine, but also keep some separate 🙂

  4. Yes, I think combining your finances is a great idea for various reason. However, communication and being on the same page is key, otherwise, one or both spouses can see that combing bank account as just more available money to spend. I know that doesn’t sound right, but I’m quite certain that it happens.

    With marriage should come trust and understanding. That’s why you should understand your partner’s financial situation and their overall philosophy in personal finance before getting married, which I think is something you discussed recently.
    TheDailyThinker recently posted..HostPapa – Certified Green Web HostingMy Profile

  5. Your finances are combined when you get married whether you like it or not. Any type of separation is just an accounting trick. Take Daisy’s friend whose husband lost all their money in a bad investment. How would having separate finances have helped that? If the wife had kept a portion of “her” money aside and they got divorced it still would have been part the couples assets and split up accordingly. So some of “her” money would have gone to him.

    Also, lets say that one spouse gets into major credit card debt and the other is a saver. If the debting spouse gets sued it’s going to affect the saver’s savings. Just one spouse can’t file bankruptcy alone.

    If you don’t trust your partner with your finances then you shouldn’t marry them. Sorry if that sounds harsh.
    Ashley @ Money Talks recently posted..I’M DEBT FREE!!! (except for the mortgage)My Profile

  6. We didn’t have any difficulties getting on the same page, we’d already been very honest about our finances with each other. The major benefit was that during the ups and downs of our relationship there was never a yours and mine, only ours, and combining finances was a part of that.
    Andi @ MealPlanRescue recently posted..Food Connections: New SeriesMy Profile

  7. My parents combined their finances, and it’s been working wonderfully for them for ~30 years. My boyfriend and I had a theoretical discussion about combining finances. I was completely for, and he was hesitant. Turns out his dad’s ex wife had been siphoning money off the account for her own purposes before filing for divorce. I pointed out to him that if his dad had checked his own account periodically he would have seen this happening. I’ve talked to a number of people who are scared of combining accounts for similar reasons, but as long as you’re both engaged in your finances, it should never be an issue. Good post.

    By the way, I tagged you in a recent post:
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    • I would tell your boyfriend that combining finances wasn’t the problem, it was the dysfunctional relationship. By expecting problems, you are almost guaranteed to have them.

      Marriage/relationships are about trust, and yes, there is risk. I think you guys will figure it out for the better.
      John recently posted..Combining Finances and EffortsMy Profile

  8. This is a great post, and something I’ve been thinking about a lot, now that the bf and I are thinking about marriage. I have to admit I’m the one who’s a little nervous about combining finances (because my father was a poor money manager in my early childhood, not because bf is bad with money). I guess it’s something we’ll have to discuss more. In theory, I know that combining finances makes sense, in practice it’s still a little scary to me.

    • Past experiences can make it tough to move forward, both with money and with trust. I ultimately think an investment in trust is the better choice, but if you are financially OK and both agree to keep some things separate, I think it can work.
      John recently posted..Combining Finances and EffortsMy Profile

  9. I totally agree with the communication portion of the post, but not with moving to a single bank account. That part works for some, but in my experience working with couples, doesn’t work for many.

    To me, it’s like Ashley said above = an accounting trick. If the accounting works better for you to have two accounts, then that’s fantastic. The key is that you are open about your money with each other, not that you make the accounting more difficult because one person keeps track of expenses and the other doesn’t.

    I’ve seen plenty of marriages in shambles just because they fight about the accounting of “one checkbook.” It’s amazing how I was able to solve the problem just by recommending separate (but completely open) checkbooks.
    AverageJoe recently posted..Find Your Perfect CollegeMy Profile

    • I think you got to the heart of it. I think for some people, the combining to one checking account is a psychological act that forces reluctant people to get on the same page.

      But if couples can be on the same page with separate accounts, I would never disagree.

      I wouldn’t want to be asking my wife for a check each month for her “half” of the bills because that seems like something college roommates do. But the important thing is finding what works.

      Thanks for giving us the perspective of someone who has actually counselled couples on money!
      John recently posted..Combining Finances and EffortsMy Profile

  10. I agree the “whatever works for you” model is important. But I also believe that a lot of couple stick with this model because they have never actually tried something new or different than what they’re used to. My wife and I have always used the “your half of the money for bills” approach and keeping bank accounts separate. But I am open to combining all of our income to figure out how we both can save money.

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